Gold holds steady on hopes of US Fed nearing end of rate hikes

GOLD prices held steady on Thursday (Jul 13) after advancing more than 1 per cent in the previous session, as US inflation data raised hopes that the Federal Reserve would soon stop tightening its monetary policy.

Spot gold was almost unchanged at US$1,957.48 per ounce by 0039 GMT. US gold futures flat at US$1,962.30.

US consumer prices rose modestly in June and registered their smallest annual increase in more than two years as inflation continued to subside, but probably not fast enough to discourage the Fed from resuming raising interest rates later this month.

Gold is used as a safe investment during times of political and financial uncertainty, but higher interest rates increase the opportunity cost of holding non-yielding bullion.

US Treasury Secretary Janet Yellen’s trip to China has raised hopes in Beijing that Trump-era tariffs on Chinese imports may be eased as she tries to smooth relations between the two nations.

The Shanghai Futures Exchange is looking to expand its commodities warehousing network outside China, and is examining systems and regulations in the sector overseas, three sources with direct knowledge of the matter told Reuters.

SEE ALSO

Gold rises on softer dollar, yields ahead of US inflation data

India meanwhile restricted imports on plain gold jewellery, as the world’s second-largest consumer of the precious metal tries to plug loopholes in its trade policy.

SPDR Gold Trust GLD, the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.03 per cent to 914.66 tonnes on Wednesday from 914.95 tonnes on Tuesday.

Spot silver was little changed at US$24.1255 per ounce, platinum rose 0.6 per cent to US$951.93, and palladium edged 0.3 per cent higher to US$1,287.09. REUTERS